The Real Estate Information Center (REIC) of the Government Housing Bank has compiled a housing price index consisting of two categories: 1. New housing project price index 2. New condominium price index for properties currently on sale during Q1/2022. REIC has observed some interesting changes as follows:

  • The new housing project price index for properties on sale in Bangkok and its vicinity decreased by -0.7% in Q1 2022.

According to the report on the new housing project price index for properties on sale in Bangkok and its vicinity for Q1 2022, the index value stands at 127.3, reflecting a decrease of -0.7% compared to the same period last year (YoY). This marks the fifth consecutive quarter of decline since Q1 2021. However, compared to the previous quarter (QoQ), the new housing project price index increased by 0.4%.

Dr. Vichai Wiratthakhan, acting director of the Real Estate Information Center at the Government Housing Bank, stated that the continuous decline in the new housing project price index indicates that developers still assess that buyers in the real demand segment have limited purchasing power due to the prolonged economic downturn caused by the COVID-19 pandemic, which has lasted over two years. This situation is further exacerbated by negative factors from the ongoing conflict between Russia and Ukraine, which has led to inflation and increased living costs in Thailand in 2022. Consequently, the overall economic growth forecast may be adjusted downward from the original estimate of 3.5% – 4.5%, potentially impacting the purchasing power of the real demand segment, which is the main buyer group in the new housing market.

When analyzing the new housing project price index by area, it was found that:

  • Bangkok has an index value of 126.2, down -0.7% compared to the same period last year (YoY), and up 0.3% compared to the previous quarter (QoQ).
  • Three surrounding provinces have an index value of 128.4, down -0.5% YoY, and up 0.6% QoQ (see Table 1 and Charts 1 – 3).

The changes in the new housing project price index indicate that the index has slightly increased from the previous quarter, which may signal a trend of rising new housing project prices due to cost-push effects from rising construction material prices, labor costs, and land prices.

Table 1: New Housing Project Price Index for Properties on Sale in Bangkok - Vicinity (Year 2012 = 100.0)

Chart 1: New Housing Project Price Index for Properties on Sale in Bangkok - Vicinity (Year 2012 = 100.0)

Chart 2: Growth Rate of New Housing Project Price Index for Properties on Sale in Bangkok - Vicinity Compared to the Same Period Last Year (YoY)

Chart 3: Growth Rate of New Housing Project Price Index for Properties on Sale in Bangkok - Vicinity Compared to the Previous Quarter (QoQ)

However, when tracking the index by type of new housing project, it was found that:

1. Single House Price Index

The single house price index in Bangkok and its vicinity for Q1 2022 stands at 125.8, down -0.5% YoY, and up 0.7% QoQ.

  • Bangkok has an index value of 125.2, down -0.4% YoY, and up 0.7% QoQ.
  • Three surrounding provinces have an index value of 125.9, down -0.5% YoY, and up 0.6% QoQ (see Table 2 and Charts 1 - 3).

Table 2: Single House Price Index in Bangkok - Vicinity (Year 2012 = 100.0)

2. Townhouse Price Index

The townhouse price index in Bangkok - Vicinity for Q1 2022 stands at 129.0, down -0.9% YoY, and up 0.2% QoQ.

  • Bangkok has an index value of 127.1, down -0.9% YoY, and up slightly by 0.02% QoQ.
  • Three surrounding provinces have an index value of 131.6, down -0.4% YoY, and up 0.6% QoQ (see Table 3 and Charts 1 - 3).

Table 3: Townhouse Price Index in Bangkok - Vicinity (Year 2012 = 100.0)

Regarding promotional offers for new housing projects currently on sale in this quarter, it was found that the majority, 45.7%, were in the form of cash discounts, which increased from 28.8% in the previous quarter. Following that, 28.6% were promotional gifts, which decreased from 44.4% in the previous quarter, and 25.8% were discounts on transfer fees and/or free maintenance fees, which slightly decreased from 26.7% in the previous quarter (see Chart 4).

Chart 4: Promotional Offers for New Housing Projects Currently on Sale in Q4 2021 - Q1 2022

  • The new condominium price index for properties on sale in Bangkok - Vicinity decreased by -0.3% in Q1 2022.

For the new condominium price index for properties on sale in Bangkok - Vicinity in Q1 2022, the index value is 151.7, down -0.3% YoY. The new condominium price index has decreased for six consecutive quarters since Q4 2020. However, compared to the previous quarter (QoQ), the new condominium price index increased by 0.3, indicating that new condominium prices are likely to rise in line with inflation and new construction costs, after the existing stock of new condominiums at previous construction costs has been sufficiently absorbed by the market.

The continuous decline in new condominium prices is a result of the ongoing supply surplus due to the diminished purchasing power of foreign buyers, particularly from China, who have not yet been allowed to travel to Thailand. Additionally, the purchasing power of investors and speculators has decreased due to the recent LTV measures announced by the Bank of Thailand. Even though the Bank of Thailand has relaxed the LTV measures, the purchasing power remains affected by the sluggish economy due to the prolonged COVID-19 pandemic, which has seen multiple severe waves over more than two years, resulting in a slow economic recovery. The ongoing conflict between Russia and Ukraine has further contributed to the downward adjustment of expected economic growth. Nevertheless, the decline in condominium sales has led developers to delay the launch of new condominium projects over the past two years (2020 - 2021), which has positively resulted in a continuous reduction of excess supply in the new condominium market.

The new condominium price index for properties on sale in Q1 2022, when analyzed by area, shows:

  • Bangkok has an index value of 153.2, down -0.2% YoY, and up 0.2% QoQ.
  • Two surrounding provinces have an index value of 144.1, down -0.8% YoY, and up 0.7% QoQ (see Table 1 and Charts 1 - 2).

Table 1: New Condominium Price Index for Properties on Sale in Bangkok - Vicinity (Year 2012 = 100.0)

Chart 1: New Condominium Price Index for Properties on Sale in Bangkok - Vicinity (Year 2012 = 100.0)

Chart 2: Growth Rate of New Condominium Price Index for Properties on Sale in Bangkok - Vicinity Compared to the Same Period Last Year (YoY)

For the promotional offers for new condominiums currently on sale in this quarter, it was found that the majority, 53.5%, were in the form of cash discounts or free living for 1 – 2 years, which increased from 28.3% in the previous quarter. Following that, 24.3% were promotional gifts, which decreased from 45.0% in the previous quarter, and 22.3% were discounts on transfer fees, which decreased from 26.7% in the previous quarter (see Chart 3).

Chart 3: Comparison of Promotional Offers for New Condominiums Currently on Sale in Q4 2021 - Q1 2022

Data Compilation Method

The new housing project price index for properties on sale includes the single house price index and the townhouse price index in new housing projects still on sale. Projects currently on sale refer to those with the lowest selling price. In compiling this price index, second-hand houses are not included. The data collection area includes Bangkok and its vicinity, comprising only four provinces: Bangkok, Nonthaburi, Pathum Thani, and Samut Prakan.

The sampling method for compiling this price index uses purposive sampling with 245 samples. The selling prices used to compile this price index are actual selling prices, which have deducted the value of promotional offers from the listed selling prices, using 2012 as the base year.

The new condominium price index for properties on sale refers to the prices of condominiums in projects with at least six units available for sale. In compiling this price index, second-hand condominiums are not included.

The data collection area includes Bangkok and its vicinity, comprising only three provinces: Bangkok, Nonthaburi, and Samut Prakan.

The sampling method for compiling this price index uses simple random sampling with 150 samples. The selling prices used to compile this index are actual selling prices, which have deducted the value of promotional offers from the listed selling prices, using 2012 as the base year.